Main Line Health is anticipating its second consecutive $100 million annual loss. It's a sign of how troubled the industry is.

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Seismic shifts in the labor market have forced hospitals to pay more to attract and keep nurses and other hospital staff combined soaring costs have led to widespread hospital operating losses. “We are in a crisis,” Main Line Health CEO Jack Lynch said.

A growing mismatch between revenues and expenses

For many years, hospitals were able to secure higher payments from commercial insurers to make up for the government’s low rates — which meant that employers were subsidizing Medicare — but that’s no longer happening, Lynch said., despite significantly higher costs, and rates for doctors went down, according to Moody’s Investors Service. On Jan. 1, a 4% reduction in Medicare rates is scheduled, unless Congress blocks it.If the Jan.

“We recognize the challenges hospitals and physicians face during this time of unprecedented change,” said Independence executive vice president Richard Snyder. “We also have a responsibility to our members and employer partners to keep health care affordable.”As hospitals adjust to new conditions, not all the changes they make will be popular with patients and their families.

 

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